IN JAN. SPEECH, OBAMA LIKELY TO ANNOUNCE MAJOR CHANGES CURTAILING NSA -- LOOK FOR OBAMA PRESSER TODAY -- BAUCUS DOMINOES: Wyden to be Finance chair; Landrieu in line for Energy

COMING ATTRACTIONS: Former administration officials tell Playbook that President Obama is likely to accept many of the most sweeping recommendations from the panel that called this week for a dramatic curtailment in NSA data mining. Among the ideas POTUS is likely to embrace: Intercepted data will reside with the phone companies rather than with the government. And NSA decisions will have more third-party involvement, including guidelines from the White House about spying on world leaders – who the U.S. targets, and what it collects.

--A former senior administration official tells us: “This blue-ribbon panel gives him the cover to do what he wants to do anyway. With this president, look at where he’s been to know where he’s going. He’s a constitutional law professor, and instinctively favors transparency. This is a chance to calm down a lot of surveillance that obviously has gone too far. I think that his going-in position will be that he’ll be for these recommendations -- people would have to talk him out of them. Even the intel community now recognizes that more White House oversight and decision-making about collection priorities will help them get buy-in and give political cover .”

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--PULLING BACK THE CAMERA – “NSA debate shifts in favor of surveillance limits,” by AP White House Correspondent Julie Pace: “In a sharp and unexpected shift, the national debate over U.S. government surveillance seems to be turning in favor of reining in the NSA’s … powers … It's happened suddenly, over a span of just three days.” http://goo.gl/OoYMqZ

--THE BIG PICTURE – “This Week May Have Been The Tipping Point For Saving American Privacy,” by Business Insider’s Michael Kelley: “Privacy advocates have had a fantastic week. On Monday, federal judge Richard Leon ruled that the National Security Agency's program that collects … metadata … on telephone calls in the United States is likely unconstitutional … Pre-Snowden, the NSA could stonewall most legal attempts against the program on national security grounds.” http://goo.gl/0s5Dpt

--HOW IT’S PLAYING: WashPost 2-col. lead, “Defenses of NSA program eroding: EFFECTIVENESS AND LEGALITY QUESTIONED -- Obama faces dilemma on phone-data collection” … NYT A1 refer, “Choosing a Legacy on Spying: … Will he be the commander in chief many expected in 2008 or remain the one he became in 2009? The answer may define national security long after his term ends.”

DRIVING THE DAY: President Obama is expected to hold a news conference, before heading off for two weeks in Hawaii.

CAPITOL SHOCK -- “The Baucus backstory,” by Manu Raju, with Maggie Haberman and Seung Min Kim: “Sen. Max Baucus’s likely new job as the next U.S. envoy to China sent shockwaves through the Senate. But behind the scenes, the veteran Montana Democrat had for weeks been paving the way for President Obama to nominate him … After a series of back-channel discussions with Senate Democratic leaders, sensitive conversations with senior White House officials and at a consequential lunch with Vice President Biden, Baucus emerged as the clear-front runner to succeed Gary Locke in Beijing. The vice president — an old friend of Baucus’s dating back to their three decades of serving together in the Senate — had emerged as a chief advocate … a topic they discussed … at Biden’s residence … several weeks ago …

“That friendship, along with Baucus’s close ties with his former chief of staff, Jim Messina, who was also the president’s 2012 campaign manager, helped make what seemed like a pipe dream a reality. Messina quietly asked Baucus sometime in November if he would ever consider accepting the China post. After thinking about it, he told Messina he would. Messina spoke with two senior White House officials -- Pete Rouse and Alyssa Mastromonaco -- and the White House reported back it was ‘intrigued’ … There were additional conversations with Senate Majority Leader Harry Reid and his chief of staff, David Krone, as well as between Messina and Biden, who is so close to Baucus that he attended his wedding in 2011. … The move could … reverberate across the 2014 landscape, with Baucus’s seat central to the fight for the Senate.”

--THE NEXT FINANCE CHAIR: “Baucus’s resignation … would mean he’d relinquish his post as chairman of the Senate Finance Committee, which has sweeping jurisdiction over taxes, international trade and health care … Reid … turned to the next most senior member of the panel, West Virginia Democrat Jay Rockefeller … But Rockefeller, retiring at the end of next year and settled at his chairmanship running the Commerce Committee, turned [it] down … That left Sen. Ron Wyden — the Oregon Democrat whose calls to overhaul Medicare worries some on the left — as the next most senior successor … Wyden privately accepted the post …

“On Thursday, … Wyden … made clear that just like Baucus, he sets a high priority in overhauling the Tax Code, though his views may be more in line with his party leadership over revenue increases than the centrist Baucus’s have been.” http://goo.gl/4fnkbR

--DOMINOES -- “Montana senator's move to China could shift Sen. Mary Landrieu to Energy Commitee chair,” by Bruce Alpert of The (New Orelans) Times-Picayune, in D.C.: “Wyden [, headed to Finance, is ]the current chairman of the Senate Energy Committee ... Landrieu would be next in line to become Energy Committee chair.” http://goo.gl/5H3aMM

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“SPIN THIS!” CONTEST – NOON DEADLINE! This week’s challenge for Playbook readers, from POLITICO Magazine: Gov. Chris Christie is accused of closing on the George Washington Bridge to punish a Democratic mayor who didn’t endorse his reelection. Christie says the story has been “sensationalized” and denies any involvement in the lane closures, which snarled traffic between Manhattan and Fort Lee, N.J. Two Christie appointees have resigned from the Port Authority. Could Christie have handled this better? If you were his P.R. adviser, what would you have told him to say or do? What would you tell him to do now? Email your answer to magazinesubmissions@politico.com. We’ll publish the results Friday evening at politico.com/magazine and announce a winner in Monday’s Playbook.

SPARTAN INAUGURATION IN NYC: When Mayor-elect Bill de Blasio takes office Jan. 1, he won’t celebrate with inaugural balls, in an effort to reflect the populist message of his campaign. Organizers tell us they’re thinking of it as “the inauguration for all,” or “the people’s inauguration.” Gabrielle Fialkoff, the inaugural’s chairwoman, said in a phone interview that as many as 12,000 to 15,000 New Yorkers will shake the new mayor’s hand during inauguration week. For the swearing-in, at noon on New Year’s Day, the 5,000 guests will include hundreds of everyday New Yorkers who next week will have first-come, first-served chance to get tickets through the transition website.

After the swearing-in, there’ll be two receptions. For the patient, there’ll be a receiving line snaking through the rooms of City Hall, with docents to talk about the building’s history and furnishings. People who wait it out will get a photo oppo with the mayor. For those who just want to warm up after the three hours they’re likely to spend outside on City Hall Plaza before and during the ceremony, there’ll be a huge tent with hot cider, hot chocolate and sparkling water, along with food favorites from the five boroughs. On Sunday, Jan. 5, from noon to 5, de Blasio will hold a Gracie Mansion Open House, with a tour and receiving line. When tickets were offered on Wednesday, all 7,000 spots were gone in 2 ½ hours. There’s now a waiting list of several thousand people, and organizers are looking at a way to accommodate some more.

--KEEP UP WITH DE BLASIO, Cuomo, Mayor of the World Bloomberg and other N.Y. power players with Capital Playbook, which we write with our Capital New York colleagues Azi Paybarah in Manhattan and Jimmy Vielkind in Albany. One-click sign-up http://goo.gl/ki07Id

BEHIND THE CURTAIN – Katie Couric’s view of ABC’s cancellation of her daytime show, “Katie,” per a friend: “She had the highest rated new show from the ’12-’13 and ’13-’14 seasons. While her show did have bigger budgets, it was because it was the only daytime program of its kind -- with field producers, etc. The landscape of daytime TV has changed and the daytime audience didn't prioritize the more serious topics that Katie still wanted to cover. She has her ground-breaking Yahoo deal starting in early ’14, and she is executive producer (with Laurie David) of ‘Fed Up,’ a documentary about the causes of childhood obesity that premieres at Sundance in a few weeks. And she's getting married. She will still be taping new shows through mid-June. She got very warm reception from staff for telling them herself that there would not be a third season -- something that was not a surprise to anyone.”

NYT EXECUTIVE EDITOR JILL ABRAMSON emails the staff about The Magazine, which announced editor Hugo Lindgren’s departure last month: “I've spent the past weeks talking to people who, like me, adore the magazine. Also to people who are dying to be the editor … This is one of the true jewels in journalism left to covet. The more I listened, the more I came to believe that I owe you more than a new editor. I owe you more clarity on how the magazine relates to the rest of our news report and how it can be the most distinctive, edifying, pleasurable part of our news offerings. … There are urgent issues and questions: how to make the magazine the fount of our richest, most immersive multimedia reading; which long reads belong in the A book and which might fare better with editing and presentation in the magazine; should there be more dedicated staff writers, how do we forge stronger relationships with the best of our freelancers in an ever more competitive environment? …

“I have asked Dean Baquet, the master of narrative journalism, to plunge into the challenges facing the magazine and to devote most of his time to this project for the next three months. Dean will work in partnership with Deborah Needleman, who has so brilliantly steered the Ts in a way that maximizes their potential and has invented several successful magazines. They will work closely with Lauren Kern, Joel Lovell, Kathy Ryan, and Rem Duplessis as well as the magazine's other fine editors. … This means the magazine will, for the next three months, continue under the inspired leadership of Lauren and Joel, who impress us every week with their passion and commitment to the magazine , and the other terrific members of the magazine's staff. The staff has rallied to produce some of the most superb issues of the year.”

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Authors:

About The Author

Mike Allen is the chief White House correspondent for POLITICO. He comes to us from Time magazine where he was their White House correspondent. Prior to that, Allen spent six years at The Washington Post, where he covered President Bush's first term, Capitol Hill, campaign finance, and the Bush, Gore and Bradley campaigns of 2000. Before turning to national politics, he covered schools and local governments in rural counties outside Fredericksburg, Va., for The Free Lance-Star, then wrote about Doug Wilder, Oliver North, Chuck Robb and the Bobbitts for the Richmond Times-Dispatch, where he nurtured police sources on overnight ride-alongs through housing projects. Allen also covered Mayor Giuliani, the Connecticut statehouse and the wacky rich of Greenwich for The New York Times. Before moving to The Times, he did stints in the Richmond and Alexandria bureaus of The Washington Post. Allen grew up in Orange County, Calif., and has a B.A. from Washington and Lee University, where he majored in politics and journalism.